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2018 (8) TMI 572 - AT - Income TaxDisallowance made of interest made u/s 36(1)(iii) - Held that:- Investment made in capital work in progress the ITAT, we find, agreed with the CIT(Appeals) that for the purpose of making disallowance of interest on account of investment made in work in progress, it was necessary to show that interest bearing funds had been borrowed specifically for the said purpose, which was not done by the Revenue. The Revenue, in the present case, we find, has not brought out to our notice any distinguishing facts. Even otherwise, assessee has demonstrated the availability of enough own funds for the purpose of making investment in land during the year, which fact has not been controverted by the Revenue before us. Therefore, following the parity of reasoning made in the earlier years by the I.T.A.T., no disallowance of interest on account of investment made in land during the year, we hold, was also warranted. Disallowance made u/s 14A r.w.r. 8D - Held that:- In view of the admitted fact that in preceding years the ITAT had held the exclusion of interest paid on specific loans taken for business purposes from the interest disallowable u/s 14A of the Act, we find no reason to interfere in the order of the CIT(Appeals) directing the Assessing Officer to recompute the disallowance in accordance with the said direction of the ITAT. No distinguishing facts have been brought to our notice by the Ld. DR. Therefore the direction of the CIT(Appeals) to follow the order of the ITAT in the preceding year in this respect is upheld.
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